Yahoo Finance FIS Rises by 8%: What Could Its 1Q16 Earnings Data Have in Store?
Bright Skies Ahead? A Look at FIS after the SunGard Acquisition
Earnings preview
FIS (FIS) is scheduled to declare its 1Q16 earnings on May 3, 2016. Wall Street analysts (SPY) surveyed by Bloomberg expect it to report EPS (earnings per share) of $0.75 for 1Q16, compared with the $0.65 reported in the same period of last year.
So far in 2016, FIS’s shares have outperformed the financial sector as well as the broad market. The Financial Select Sector SPDR ETF (XLF)(VFH) represents the financial sector. Year-to-date, the financial sector has lost 1.8%. In comparison, FIS has gained 8%.
Peers’ performance
Since the beginning of 2016, the financial sector has been under the knife, backed by fears of a global recession and low interest rates. Year-to-date, shares of peers Fiserv (FISV) and Jack Henry & Associates (JKHY) have gained 6.5% and 4.3%, respectively.
Company overview
FIS is a provider of software solutions to banks and financial institutions. According to the company’s website, it’s “the world’s largest global provider dedicated to banking and payments technologies.”
Any modern financial institution needs the kind of software solutions that FIS provides, which makes the demand for its products fairly steady and secure. The company operates on long-term contracts with its clients, generating recurring and steady revenues. This provides a strong foundation for the company’s operations and enables it to reward shareholders with dividends and share repurchases, as well as grow inorganically through acquisitions.
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